General Motors’ purchasing chief says his suppliers are not demanding shorter payment terms or cash on delivery, despite the automaker’s shaky finances.
“Our suppliers are behind us,” Bo Andersson, GM group vice president for purchasing and supply chain, told Automotive News.
Andersson concedes that supplier CEOs face difficult conversations with their nervous directors, who worry about GM’s ability to pay as it suffers a liquidity squeeze and delays in getting financial aid from Congress.
A demand for shorter or COD terms could only add to GM’s massive cash burn.
Andersson said he is in regular communication with all GM suppliers. “It is very important to be very transparent and be open about the changes we see in the workplace with production schedules, product delay and any product changeovers,” he said.
Andersson said the supply base has continued to work hard with GM purchasing to achieve productivity savings to cut costs. GM shares half of its suppliers’ annual savings. Last year that amounted to about $2 billion.